PART I—DESIGNATION
§1391. Designation procedure
(a) In general
From among the areas nominated for designation under this section, the appropriate Secretaries may designate empowerment zones and enterprise communities.
(b) Number of designations
(1) Enterprise communities
The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
(2) Empowerment zones
The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
(c) Period designations may be made
A designation may be made under subsection (a) only after 1993 and before 1996.
(d) Period for which designation is in effect
(1) In general
Any designation under this section shall remain in effect during the period beginning on the date of the designation and ending on the earliest of—
(A)(i) in the case of an empowerment zone, December 31, 2025, or
(ii) in the case of an enterprise community, the close of the 10th calendar year beginning on or after such date of designation,
(B) the termination date designated by the State and local governments as provided for in their nomination, or
(C) the date the appropriate Secretary revokes the designation.
(2) Revocation of designation
The appropriate Secretary may revoke the designation under this section of an area if such Secretary determines that the local government or the State in which it is located—
(A) has modified the boundaries of the area, or
(B) is not complying substantially with, or fails to make progress in achieving the benchmarks set forth in, the strategic plan under subsection (f)(2).
(e) Limitations on designations
No area may be designated under this section unless—
(1) the area is nominated by 1 or more local governments and the State or States in which it is located for designation under this section,
(2) such State or States and the local governments have the authority—
(A) to nominate the area for designation under this section, and
(B) to provide the assurances described in paragraph (3),
(3) such State or States and the local governments provide written assurances satisfactory to the appropriate Secretary that the strategic plan described in the application under subsection (f)(2) for such area will be implemented,
(4) the appropriate Secretary determines that any information furnished is reasonably accurate, and
(5) such State or States and local governments certify that no portion of the area nominated is already included in an empowerment zone or in an enterprise community or in an area otherwise nominated to be designated under this section.
(f) Application
No area may be designated under this section unless the application for such designation—
(1) demonstrates that the nominated area satisfies the eligibility criteria described in section 1392,
(2) includes a strategic plan for accomplishing the purposes of this subchapter that—
(A) describes the coordinated economic, human, community, and physical development plan and related activities proposed for the nominated area,
(B) describes the process by which the affected community is a full partner in the process of developing and implementing the plan and the extent to which local institutions and organizations have contributed to the planning process,
(C) identifies the amount of State, local, and private resources that will be available in the nominated area and the private/public partnerships to be used, which may include participation by, and cooperation with, universities, medical centers, and other private and public entities,
(D) identifies the funding requested under any Federal program in support of the proposed economic, human, community, and physical development and related activities,
(E) identifies baselines, methods, and benchmarks for measuring the success of carrying out the strategic plan, including the extent to which poor persons and families will be empowered to become economically self-sufficient, and
(F) does not include any action to assist any establishment in relocating from one area outside the nominated area to the nominated area, except that assistance for the expansion of an existing business entity through the establishment of a new branch, affiliate, or subsidiary is permitted if—
(i) the establishment of the new branch, affiliate, or subsidiary will not result in a decrease in employment in the area of original location or in any other area where the existing business entity conducts business operations, and
(ii) there is no reason to believe that the new branch, affiliate, or subsidiary is being established with the intention of closing down the operations of the existing business entity in the area of its original location or in any other area where the existing business entity conducts business operation, and
(3) includes such other information as may be required by the appropriate Secretary.
(g) Additional designations permitted
(1) In general
In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
(2) Period designations may be made and take effect
A designation may be made under this subsection after the date of the enactment of this subsection and before January 1, 1999.
(3) Modifications to eligibility criteria, etc.
(A) Poverty rate requirement
(i) In general
A nominated area shall be eligible for designation under this subsection only if the poverty rate for each population census tract within the nominated area is not less than 20 percent and the poverty rate for at least 90 percent of the population census tracts within the nominated area is not less than 25 percent.
(ii) Treatment of census tracts with small populations
A population census tract with a population of less than 2,000 shall be treated as having a poverty rate of not less than 25 percent if—
(I) more than 75 percent of such tract is zoned for commercial or industrial use, and
(II) such tract is contiguous to 1 or more other population census tracts which have a poverty rate of not less than 25 percent (determined without regard to this clause).
(iii) Exception for developable sites
Clause (i) shall not apply to up to 3 noncontiguous parcels in a nominated area which may be developed for commercial or industrial purposes. The aggregate area of noncontiguous parcels to which the preceding sentence applies with respect to any nominated area shall not exceed 2,000 acres.
(iv) Certain provisions not to apply
Section 1392(a)(4) (and so much of paragraphs (1) and (2) of section 1392(b) as relate to section 1392(a)(4)) shall not apply to an area nominated for designation under this subsection.
(v) Special rule for rural empowerment zone
The Secretary of Agriculture may designate not more than 1 empowerment zone in a rural area without regard to clause (i) if such area satisfies emigration criteria specified by the Secretary of Agriculture.
(B) Size limitation
(i) In general
The parcels described in subparagraph (A)(iii) shall not be taken into account in determining whether the requirement of subparagraph (A) or (B) of section 1392(a)(3) is met.
(ii) Special rule for rural areas
If a population census tract (or equivalent division under section 1392(b)(4)) in a rural area exceeds 1,000 square miles or includes a substantial amount of land owned by the Federal, State, or local government, the nominated area may exclude such excess square mileage or governmentally owned land and the exclusion of that area will not be treated as violating the continuous boundary requirement of section 1392(a)(3)(B).
(C) Aggregate population limitation
The aggregate population limitation under the last sentence of subsection (b)(2) shall not apply to a designation under paragraph (1).
(D) Previously designated enterprise communities may be included
Subsection (e)(5) shall not apply to any enterprise community designated under subsection (a) that is also nominated for designation under this subsection.
(E) Indian reservations may be nominated
(i) In general
Section 1393(a)(4) shall not apply to an area nominated for designation under this subsection.
(ii) Special rule
An area in an Indian reservation shall be treated as nominated by a State and a local government if it is nominated by the reservation governing body (as determined by the Secretary of the Interior).
(h) Additional designations permitted
(1) In general
In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
(2) Period designations may be made and take effect
A designation may be made under this subsection after the date of the enactment of this subsection and before January 1, 2002.
(3) Modifications to eligibility criteria, etc.
The rules of subsection (g)(3) shall apply to designations under this subsection.
(4) Empowerment zones which become renewal communities
The number of areas which may be designated as empowerment zones under this subsection shall be increased by 1 for each area which ceases to be an empowerment zone by reason of section 1400E(e).1 Each additional area designated by reason of the preceding sentence shall have the same urban or rural character as the area it is replacing.
(Added
Editorial Notes
References in Text
The date of the enactment of this subsection, referred to in subsec. (g)(2), is the date of enactment of
The date of the enactment of this subsection, referred to in subsec. (h)(2), is the date of enactment of
Section 1400E(e), referred to in subsec. (h)(4), was repealed by
Prior Provisions
A prior section 1391, added
Amendments
2020—Subsec. (d)(1)(A)(i).
2019—Subsec. (d)(1)(A)(i).
2018—Subsec. (d)(1)(A)(i).
Subsec. (g)(3)(E)(ii).
2015—Subsec. (d)(1)(A)(i).
2014—Subsec. (d)(1)(A)(i).
2013—Subsec. (d)(1)(A)(i).
2010—Subsec. (d)(1)(A)(i).
Subsec. (h)(2).
2000—Subsec. (d)(1)(A).
Subsec. (g)(3)(C).
Subsec. (h).
1997—Subsec. (b)(2).
Subsec. (c).
Subsecs. (e), (f).
Subsec. (g).
Statutory Notes and Related Subsidiaries
Effective Date of 2020 Amendment
Effective Date of 2019 Amendment
Effective Date of 2018 Amendment
Effective Date of 2015 Amendment
Effective Date of 2014 Amendment
Effective Date of 2013 Amendment
Amendment by
Effective Date of 2010 Amendment
Amendment by
Effective Date of 1997 Amendment
Treatment of Certain Termination Dates Specified in Nominations
1 See References in Text note below.
§1392. Eligibility criteria
(a) In general
A nominated area shall be eligible for designation under section 1391 only if it meets the following criteria:
(1) Population
The nominated area has a maximum population of—
(A) in the case of an urban area, the lesser of—
(i) 200,000, or
(ii) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area, and
(B) in the case of a rural area, 30,000.
(2) Distress
The nominated area is one of pervasive poverty, unemployment, and general distress.
(3) Size
The nominated area—
(A) does not exceed 20 square miles if an urban area or 1,000 square miles if a rural area,
(B) has a boundary which is continuous, or, except in the case of a rural area located in more than 1 State, consists of not more than 3 noncontiguous parcels,
(C)(i) in the case of an urban area, is located entirely within no more than 2 contiguous States, and
(ii) in the case of a rural area, is located entirely within no more than 3 contiguous States, and
(D) does not include any portion of a central business district (as such term is used for purposes of the most recent Census of Retail Trade) unless the poverty rate for each population census tract in such district is not less than 35 percent (30 percent in the case of an enterprise community).
(4) Poverty rate
The poverty rate—
(A) for each population census tract within the nominated area is not less than 20 percent,
(B) for at least 90 percent of the population census tracts within the nominated area is not less than 25 percent, and
(C) for at least 50 percent of the population census tracts within the nominated area is not less than 35 percent.
(b) Special rules relating to determination of poverty rate
For purposes of subsection (a)(4)—
(1) Treatment of census tracts with small populations
(A) Tracts with no population
In the case of a population census tract with no population—
(i) such tract shall be treated as having a poverty rate which meets the requirements of subparagraphs (A) and (B) of subsection (a)(4), but
(ii) such tract shall be treated as having a zero poverty rate for purposes of applying subparagraph (C) thereof.
(B) Tracts with populations of less than 2,000
A population census tract with a population of less than 2,000 shall be treated as having a poverty rate which meets the requirements of subparagraphs (A) and (B) of subsection (a)(4) if more than 75 percent of such tract is zoned for commercial or industrial use.
(2) Discretion to adjust requirements for enterprise communities
In determining whether a nominated area is eligible for designation as an enterprise community, the appropriate Secretary may, where necessary to carry out the purposes of this subchapter, reduce by 5 percentage points one of the following thresholds for not more than 10 percent of the population census tracts (or, if fewer, 5 population census tracts) in the nominated area:
(A) The 20 percent threshold in subsection (a)(4)(A).
(B) The 25 percent threshold in subsection (a)(4)(B).
(C) The 35 percent threshold in subsection (a)(4)(C).
If the appropriate Secretary elects to reduce the threshold under subparagraph (C), such Secretary may (in lieu of applying the preceding sentence) reduce by 10 percentage points the threshold under subparagraph (C) for 3 population census tracts.
(3) Each noncontiguous area must satisfy poverty rate rule
A nominated area may not include a noncontiguous parcel unless such parcel separately meets (subject to paragraphs (1) and (2)) the criteria set forth in subsection (a)(4).
(4) Areas not within census tracts
In the case of an area which is not tracted for population census tracts, the equivalent county divisions (as defined by the Bureau of the Census for purposes of defining poverty areas) shall be used for purposes of determining poverty rates.
(c) Factors to consider
From among the nominated areas eligible for designation under section 1391 by the appropriate Secretary, such appropriate Secretary shall make designations of empowerment zones and enterprise communities on the basis of—
(1) the effectiveness of the strategic plan submitted pursuant to section 1391(f)(2) and the assurances made pursuant to section 1391(e)(3), and
(2) criteria specified by the appropriate Secretary.
(d) Special eligibility for nominated areas located in Alaska or Hawaii
A nominated area in Alaska or Hawaii shall be treated as meeting the requirements of paragraphs (2), (3), and (4) of subsection (a) if for each census tract or block group within such area 20 percent or more of the families have income which is 50 percent or less of the statewide median family income (as determined under section 143).
(Added
Editorial Notes
Prior Provisions
A prior section 1392, added
Amendments
1997—Subsec. (d).
§1393. Definitions and special rules
(a) In general
For purposes of this subchapter—
(1) Appropriate Secretary
The term "appropriate Secretary" means—
(A) the Secretary of Housing and Urban Development in the case of any nominated area which is located in an urban area, and
(B) the Secretary of Agriculture in the case of any nominated area which is located in a rural area.
(2) Rural area
The term "rural area" means any area which is—
(A) outside of a metropolitan statistical area (within the meaning of section 143(k)(2)(B)), or
(B) determined by the Secretary of Agriculture, after consultation with the Secretary of Commerce, to be a rural area.
(3) Urban area
The term "urban area" means an area which is not a rural area.
(4) Special rules for Indian reservations
(A) In general
No empowerment zone or enterprise community may include any area within an Indian reservation.
(B) Indian reservation defined
The term "Indian reservation" has the meaning given such term by section 168(j)(6).
(5) Local government
The term "local government" means—
(A) any county, city, town, township, parish, village, or other general purpose political subdivision of a State, and
(B) any combination of political subdivisions described in subparagraph (A) recognized by the appropriate Secretary.
(6) Nominated area
The term "nominated area" means an area which is nominated by 1 or more local governments and the State or States in which it is located for designation under section 1391.
(7) Governments
If more than 1 State or local government seeks to nominate an area under this part, any reference to, or requirement of, this subchapter shall apply to all such governments.
(8) Special rule
An area shall be treated as nominated by a State and a local government if it is nominated by an economic development corporation chartered by the State.
(9) Use of census data
Population and poverty rate shall be determined by the most recent decennial census data available.
(b) Empowerment zone; enterprise community
For purposes of this title, the terms "empowerment zone" and "enterprise community" mean areas designated as such under section 1391.
(Added
Editorial Notes
Prior Provisions
A prior section 1393, added